Vendor Calls For Loss Mitigation Reform

According to Mortgage Cadence, the time has come for loan servicers and lenders to remove manual/inefficient processes and embrace online technology that enables them to more efficiently meet the ever-increasing need for successful analysis and evaluation of loss mitigation efforts. To this end, the vendor has launched the Loss Mitigation Gateway to provide online initiation, management and execution of the loss mitigation process.

"In these tumultuous times, there is an enormous need within the servicing community for rapid and efficient loss mitigation solutions to assist in the modification of troubled mortgages," stated Trevor Gauthier, vice president of marketing at Mortgage Cadence in a prepared statement. "Our Loss Mitigation Gateway fulfills this need by quickly analyzing loans against the required HAMP guidelines and/or other proprietary products (i.e. straight capitalization, principal forbearance, rate relief, rate relief with extended term) and generating/distributing loan modification packages for qualified loans." The Loss Mitigation Gateway provides users with real-time pipeline viewing and a variety of defined workflow paths based on the functional group of the associated user. Upon loan entry/import, the system validates that the required data is present/reasonable and executes the appropriate calculations (including NPV and DTI). When run, the waterfall calculation determines if the loan(s) qualifies for a modification (HAMP or proprietary) and what the new loan terms will be for that modification. The results are displayed for review/approval. Additional QA/underwriting information can be collected as needed (i.e. basic eligibility validation, updated borrower income collection, Imminent Default Verification, etc.).

Upon completion and validation of analytics, the Loss Mitigation Gateway generates loan modification document packages (including the standard HUD-approved HAMP modification package) while maintaining the appropriate status updates within the pipeline. The Loss Mitigation Gateway allows the user to have the generated document packages securely distributed to the borrower. Clients may also elect to have the packages returned to a specific address or to a collection center.

"The heightened regulatory scrutiny surrounding loss mitigation coupled with the associated risks and failure rate of current products creates a number of challenges for servicers and lenders," added Michael Detwiler, Chief Executive Officer of Mortgage Cadence. "Our entrance into the loss mitigation space is a manifestation of our continued commitment to our technology platform(s) and the molding necessary to provide our customers with the solutions that they need."